Brian Lee Crowley

Why the prime minister still doesn’t understand Ottawa’s role on pipelines

When in early december he announced his decision on several pipelines, approving two and vetoing another, Prime Minister Trudeau clearly thought he was showing how these decisions ought to be reached. Others, like the NEB, hold hearing and then make recommendations but the final decision should rest with the government. He couldn’t be more wrong. As I wrote in my December 9th, 2016 column for the Gobe’s ROB, his job is to be neither cheerleader (what he criticised Stephen Harper for) *nor* referee (the hat that Trudeau donned), but rather impartial rulemaker. Just as parliament makes laws and the hands them over the judges to apply, the government should be setting the tests pipelines must meet to be in the national interest and then handing it over to the NEB and environmental assessment agencies to hold the evidence-based proceedings that determine if those tests have been met. In the long run the last place politicians want to be is holding the bag on these decisions.

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Will tougher rules for approval win over pipeline opponents?

At a time when the federal and several provincial governments have raised the bar on environmental and other standards for the oil patch it is not churlish to ask the question: will these moves, which will add both time and money to already demanding approval processes, win over those people who oppose pipelines and claim that they have no “social licence”. That’s the issue I explore in my column today for the Ottawa Citizen, Calgary Herald and other PostMedia papers. You will be unsurprised to learn that my answer is, “No”. And that means that at some point politicians will have to stop pretending that all that is required is process tweaks, that a better process will win over opponents. It won’t and at some point politicians will have to choose sides. How uncomfortable! Poor things — I almost feel sorry for them. Almost….

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Breaking the natural resource revenue boom-bust cycle in provincial finances

As the world price of oil has fallen by almost $100/barrel in the last year or so, provincial finances in places like Alberta, Saskatchewan and Newfoundland and Labrador have been savaged. But it is all so unnecessary if only these provinces and others dependent on non-renewable natural resource revenue would be guided by Jim Dinning’s insight that such revenues are “non-reliable”. and are known to be so by anyone even slightly conversant with the history on NR prices and the nature of government spending. In my late December column for the Globe’s Economy Lab feature, I lay out the case for such provinces to discipline themselves by assuming throughout the commodity cycle that the lowest price in the cycle will prevail. The money set aside during high prices can then smooth out the ups and downs. Don’t spend it if you haven’t got it, people, especially when provincial spending is notoriously inflexible, unlike these revenues!

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Canada paying price for decades of pipeline complacency

For the longest time Canada’s O&G industry reaped the benefits of having privileged access to the US market, serving regions that found it difficult or costly to bring in oil from other sources. But we assumed these golden conditions would last forever. They didn’t. Now instead of a cosy preferred supplier relationship with the US, the fracking revolution plus inadequate piupeline capacity is forcing us to sell our production at a painful discount to world prices–and the world price is low enough as it is! This is an object lesson in how canada traditionally manages its economic vulnerabilities, but shouldn’t, as I argue in my column for the 26 September edition of the Ottawa Citizen and other Postmedia papers.

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Papal deer in the headlights: Francis contradicts papal policy on human fertility

In my July 26th column for the ROB’s Economy Lab feature in the Globe I point out that in his recent encyclical on climate change Pope Francis wants to suck and blow at the same time. The pope was right to make protecting human life a goal, a goal moreover that is entirely consistent with traditional Catholic doctrine. The problem? Fossil fuel use has been an indispensable factor making it possible for the Earth to support its teeming billions….and alternative energy technologies are nowhere near ready to displace them.

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Why Saskatchewan is the place to watch in Canada

Canadians are so used to the economic action being in places like BC and Alberta (and once upon a time in Ontario!) that they have missed the dark horse coming up the inside track: Saskatchewan. The province feels like Alberta did 35 years ago. If you want to find out what’s behind the province’s rise to prosperity, read my latest column for the Economy Lab feature in the Globe’s ROB.

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Speaking in Calgary on October 8th on the concept of “social licence”

Regular visitors to this site will know I am a vociferous critic of the concept of social licence. I’ll be in Calgary on Wednesday, October 8th to speak on a panel at a conference  sponsored by the Energy and Environment Programme of the Calgary School of Public Policy. The conference is  titled “Social License in the Regulatory Arena: A Useful Concept?”. I’ll be one of the panellists in the 3rd panel session titled “Who “Owns” or “Issues” Social License? Contact the School for more information.

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MLI Study in the Vancouver Sun: First Nations support key to future of pipelines

Following the release of MLI’s latest study The Way Out: new thinking about Aboriginal engagement and energy infrastructure to the west coast, part of our ground-breaking series Aboriginal Canada and the Natural Resources Economy, my project co-leader Ken Coates, and I write in the Vancouver Sun that First Nations support will be one of the most important aspects for any energy project in Canada.

First Nations support key to future of pipelines

BY BRIAN LEE CROWLEY AND KEN COATES, VANCOUVER SUN MAY 31, 2013

Just a few weeks ago, proponents of pipelines between the Prairies and the West Coast were preparing for the worst. Adrian Dix, the apparently victory-bound leader of the B.C. NDP, had already declared Enbridge’s Northern Gateway would be dead on his watch and, mid-election, pronounced a similar sentence on Kinder Morgan’s Trans Mountain pipeline expansion plans.

The subsequent Liberal upset victory, which many analysts attribute to the NDP’s fervent opposition to wealth-creating pipelines, has given the Northern Gateway project a partial reprieve. But despite strong federal backing and now a pro-growth provincial government, the project hangs by a thread.

Premier Christy Clark has significant reservations, and knows that proceeding would attract cries of outrage from environmentalists. B.C. has its own problems with Alberta, and the souring of relations between the two western provinces over pipelines has the potential to cause great economic harm to the country. Neither issue, however, is the greatest barrier to the project’s success.

First Nations along the pipeline route hold the hammer on this project. If they remain opposed to the Enbridge proposal or to the idea of energy corridors to the coast, no pipeline will be built. Full stop. First Nations have primary social and cultural standing in this debate. If they cannot be convinced that the pipeline serves their interests and provides adequate environmental protection, the project is not going to proceed.

Equally important, First Nations have growing legal clout, best embodied in the Supreme Court recognition of the government’s duty to consult and accommodate aboriginal interests, which could hold up construction indefinitely. Even with strong federal government support and an approved environmental plan, the Northern Gateway Project likely cannot proceed.

With strong aboriginal support, however, much becomes possible. The most intense environmental activists will oppose Northern Gateway, no matter what. More practical environmentalists and conservationists, including the B.C. public, realize that resource development can be properly and safely managed. First Nations’ support, with its environmental credibility, would likely weigh heavily with them. With aboriginal backing, we think a majority of British Columbians can be brought on board.

The First Nations’ power over development arises out of a complex web of unresolved land claims, legal victories, constitutional recognition of aboriginal rights, and indigenous self-government. Aboriginal Canadians are now indispensable partners in resource development – including major infrastructure – and this reality is not going to change.

Nor is this a bad thing. Most First Nations are supportive of development, provided it proceeds on their terms and with appropriate returns in the form of jobs, revenue and business creation. There are dozens of major projects underway across the country in real partnership with First Nations, bringing substantial benefits to local communities, Canadian business and the national economy.

How will this work for Northern Gateway? Some First Nations along the pipeline route, including the Haisla on whose traditional lands the Kitimat terminus is located, are willing to proceed with properly managed development projects. First Nations along the route will have to agree to participate in Northern Gateway, ideally as equity partners (the Enbridge proposal includes 10-per-cent aboriginal equity ownership). In addition to equity participation, a proper arrangement would involve a commitment to the world’s highest standards for environmental protection along the corridor and on the coast, plus arrangements for aboriginal business development and job training, and sustained revenues for First Nations communities.

Assuming Northern Gateway gets suitable environmental and regulatory approval from the current Joint Review Process, a new approach to First Nations participation will still be needed. That almost certainly means more substantial equity ownership (not least because the equity must be shared among so many First Nations) and aboriginal involvement in environmental and project management and oversight. First Nations must be assured that they will be primary beneficiaries from a project that crosses their lands, bringing opportunity and employment instead of the unregulated socio-economic change and environmental risk they too often experienced in the past.

The way we develop resources in Canada is changing profoundly. Like it or not, Northern Gateway is a symbol for the new order. The project’s current trajectory stokes vigorous aboriginal opposition that alone could be enough to stall or even kill a project that could create vast wealth for Canadians.

A much better outcome is possible, one that meets the objections of most who oppose the project on environmental grounds and that assures aboriginal people of sustained and long-term benefits from the construction and operation of the pipeline. Northern Gateway could, with political will and openness to new arrangements, be transformed from a symbol of the new-found power of aboriginal people to stop vital national projects into a model of the real partnerships that henceforth will be the indispensable key to responsible resource development in Canada.

Brian Lee Crowley is managing director of the Macdonald-Laurier Institute. Ken Coates is the Canada Research Chair in Regional Innovation at the University of Saskatchewan. They are co-authors of The Way Out: New thinking about Aboriginal engagement and energy infrastructure to the West Coast, just released by the institute and available at macdonaldlaurier.ca.

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The Way Out: New thinking about Aboriginal engagement and energy infrastructure to the West Coast

Very proud to be co-author of this important paper over at www.macdonaldlaurier.ca outlining how Canada can live up to its potential as world energy superpower by engaging with First Nations to rescue the Northern Gateway (and other pipelines) to the West coast.  Official MLI news release and links below, please read the paper “The Way Out: New thinking about Aboriginal engagement and energy infrastructure to the West Coast“, part of MLI’s ongoing series of studies on Aboriginal communities and Canada’s resource economy.

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MEDIA RELEASE

Rescuing Northern Gateway

How engagement with and equity participation by Aboriginal communities can help Canada live up to its potential as a world energy superpower

OTTAWA May 30, 2013 – Canada is failing to live up to its potential as an energy superpower due to a lack of access to world markets, but a new paper by the Macdonald-Laurier Instituteshows how the Northern Gateway pipeline project can be put on sounder footing and deliver sustainable benefits to Canadians, including First Nations in the pipeline corridor, by increasing access to Asia.

Presently, Western Canada’s oil resources are suffering from artificially low prices as a result of lack of access to growing markets in Asia. The Northern Gateway project would help to rectify this ongoing shortfall, delivering oil to energy hungry China and India, tens of billions in increased GDP for Canadians and increased revenue for provincial and federal governments.

Right now, the biggest obstacle to approving the pipeline is not inter-provincial jurisdictional squabbles or even environmental concerns –though these are important – but the Aboriginal communities along the pipeline corridor.  Aboriginal opposition to the pipeline alone is likely enough to cripple or kill Northern Gateway and any other energy pipeline to the West coast.

With Aboriginal support, however, much is possible.

Backed up by a series of legal victories, constitutional recognition of Aboriginal rights and self-government, and examples of successful partnerships between Aboriginal and non-Aboriginal organizations, the best way to remove the main obstacles facing Northern Gateway is to engage Aboriginal communities, not only in terms of consultation but as equity stakeholders,” argue the paper’s authors Ken Coates and Brian Lee Crowley.

“Our goal with this paper was to lay out the steps that can rescue the Northern Gateway project from its current impasse, highlighting that Aboriginal communities are not opposed to development”, say the paper’s authors.  “Quite the opposite.  There are many examples of successful Aboriginal and non-Aboriginal partnerships that can serve as models to ensure that Northern Gateway can live up to its potential to produce enormous wealth for all Canadians, including Aboriginal Canadians.”

“We want to make sure that Canadians understand that Northern Gateway stands at the intersection of Canada’s aspirations to be a world energy superpower; environmental standards of 21st century resource development; and the present and future status of Aboriginal/Non-aboriginal relations in Canada.” added Coates and Crowley.  “It is in the national interest that this project move forward; otherwise, as we document in the paper, the costs of this missed opportunity would be enormous for all Canadians, not only those in Alberta and British Columbia.

The authors have identified several key factors that would help ensure Northern Gateway can be completed, including:

  • Self-financing equity participation by Aboriginal communities to ensure full partnership in every aspect of the project’s execution and operation while reducing dependence on government;
  • Creation of several separate revenue streams that benefit First Nations all along the pipeline corridor;
  • A new long-term and region-wide approach to Impact and Benefit Agreements (IBAs) that guarantee jobs, training and other economic opportunities;
  • Creating a template for further energy infrastructure developments and opening the possibility of routing them through an Aboriginal energy corridor;
  • World-leading environmental monitoring and response in the event of a spill, both along the pipeline corridor and the marine corridors where shipping traffic will occur;
  • Specific steps the governments of Canada, British Columbia and Alberta can take to make this project more acceptable to public opinion and affected communities.

Northern Gateway continues to face strong opposition, threatening the project’s viability and the vast wealth it could potentially generate for Canadians. By actively engaging with the Aboriginal communities along the corridor, and fair dealing in establishing equity partnerships to share the risks and the rewards the pipeline offers, the authors are confident that Northern Gateway could do more than carry Canada’s energy riches to international markets. It could symbolize a new era in business-First Nations-government collaboration in the proper and carefully managed development of this country’s natural resources.

Read the full report, The Way Out: New thinking about Aboriginal engagement and energy infrastructure to the West Coast,

The Macdonald-Laurier Institute is the only non-partisan, independent national public policy think tank in Ottawa focusing on the full range of issues that fall under the jurisdiction of the federal government.

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Readers interested in the issue of tanker safety on Canada’s west coast can get more information from MLI’s in-depth look in “Making Oil & Water Mix: Oil tanker traffic and Canada’s west coast”

For more information on Canada’s natural resource industry, please read MLI’s “Six Myths Surrounding the Development of Canada’s Natural Resources”

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Brian Lee Crowley